Spatial Development

Question 1

What drives globalization in the economy?

Answer 1

• division of labor and specialization
• comparative advantages (Ricardo’s theory)
• technological advancements

Question 2

What are the criteria for regions?

Answer 2

Homogeneous Regions: shared characteristics, problems, interests (e.g. Alpine Rhine Valley)

Functional Regions: social and economic interdependencies

Institutional Regions: Politically defined boundaries

Regions of Perception: Subjective or symbolic significance

Question 3

What are regional disparities and why are they important?

Answer 3

• disparities refer to inequalities or differences between regions (demographic, economic, social aspects)
• important because they help understand functional relationships, reveal spatial change and guide political and regional planning decisions

Question 4

What are the two types of regional disparities?

Answer 4

• inequalities leading to injustice (negative connotation, such as income inequality)
• inequalities as regional characteristics (value-neutral, such as cultural diversity)

Question 5

How has disparity analysis evolved historically?

Answer 5

• classic areas: population, income, employment
• expanded areas: public goods and infrastructure quality
• comprehensive assessments: include quality of life and sustainable development measures

Question 6

What are the hard and soft factors of location:

Answer 6

Hard factors: taxes, research institutions, proximity to subcontractors, accessibility etc.

Soft factors: regional image, social climate, cultural offer, gastronomic offer, criminality etc.

Question 7

What are the two main perspectives on regional growth differences?

Answer 7

• Convergence: regions with lower economic development levels catch up over time, reducing disparities
• Divergence: Disparities increase due to advantages like agglomeration effects in specific regions

Question 8

How does the neoclassical approach explain regional growth differences?

Answer 8

• disparities arise temporarily but diminish over time
• capital and labor flow to less developed regions with higher returns
• movement toward equilibrium leads to balanced growth

Question 9

What are agglomeration economies?

Answer 9

• benefits that arise from the spatial concentration of firms, industries, and people
• two main types: localization economies and urbanization economies

Question 10

What are agglomeration diseconomies?

Answer 10

negative effects of excessive concentration, such as congestion, high costs, and environmental degradation

Question 11

What is a cluster in regional growth theory?

Answer 11

• a spatial concentration of interconnected firms, suppliers, and institutions in a particular field
• clusters drive innovation, competitiveness, and economic growth

Question 12

Name the four types of clusters and explain each

Answer 12

Geographic cluster: firms located in the same area benefiting from shared infrastructure (e.g. Ruhr industrial region in Germany)

Sectoral cluster: firms in the same industry forming supply chain linkages (e.g. Detroit automotive cluster)

Functional cluster: concentration of high-value economic activities (e.g. Basel pharmaceutical hub)

Innovation cluster: networks focused on research and development (e.g. Cambridge biotech cluster)

Question 13

What is Porter’s Diamond Model?

Answer 13

a framework for understanding the competitive advantages of regions, focusing on four determinants:

• factor conditions: availability of specialized labor and infrastructure
• demand conditions: local market size and sophistication
• related and supporting industries: presence of interconnected sectors
• firm strategy, structure and rivalry: local cometition driving innovation and efficiency

Question 14

What explains uneven spatial growth distribution?

Answer 14

Agglomeration economies (external):

• economies of localization: cost advantages from the localization together of firms in the same industry
• economies of urbanization: cost advantages from urban location close to economic activity (proximity to a market, labor supply, good communications etc.)

Agglomeration economies (internal):

• economies of scale: cost advantage of a firm due to scale of operations (cost per unit of output decreasing with increasing scale)
• economies of scope: cost savings of firms from variety (diversified products)

Question 15

What are the implications of spatial concentration for regional policy?

Answer 15

• policies need to balance growth between core and peripheral areas to reduce disparities
• investment in infrastructure and connectivity can spread economic benefits

Question 16

How does infrastructure influence regional growth?

Answer 16

• reduces transportation costs, improving connectivity
• expands labor markets and business opportunities
• encourages agglomeration effects, boosting productivity

Question 17

What are the wider economic benefits of improved regional infrastructure?

Answer 17

• increased GDP per capita
• higher labor productivity
• expanded business and labor markets

Question 18

What is land rent?

Answer 18

• income from land ownership, derived from total revenue minus labor and capital costs
• includes location rent, based on proximity advantages

Question 19

What does the Thünen Model explain?

Answer 19

• land rent decreases with distance from the center
• different land uses occupy concentric zones based on rent-paying capacity

Question 20

What factors affect land rent?

Answer 20

• transportation costs
• demand for goods/services
• urban expansion

Question 21

Why is controlling spatial development important?

Answer 21

• prevents inefficient land use and urban sprawl
• promotes sustainable densification
• mitigates segregation

Question 22

What are the key drivers of housing market supply and demand?

Answer 22

• supply: land availability, building costs, and infrastructure

demand: demographics, income, and lifestyle preferences

Question 23

How does land rent influence spatial structure?

Answer 23

• high rents near the center lead to dense urban development
• peripheral areas are characterized by lower-intensity uses

Question 24

How does the levy tax on added land value work?

Answer 24

• taxes the increase in land value due to zoning changes
• at least 20% of the added value is taxed under Swiss law
• funds are used for public infrastructure and ecological projects

Question 25

What is the process for applying a levy tax during rezoning?

Answer 25

• calculate added value (post-zoning value - pre-zoning value)
• levy becomes due upon scale or construction
• tax can be deducted from real estate gain taxes